Invisible Cogs – India’s informal workers

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Half of India’s $1.85 million economy is informal. Informal workers constitute more than 90% of the country’s workforce and generate about 50% of the country’s national product. Yet, legal and policy tools have failed to create an environment which promotes secure and productive economic opportunities, labour rights and benefits and protection for these workers.

International Labour Organization (ILO) notes that the term 'informal economy' refers to all economic activities by workers and economic units that are – in law or in practice – not covered or insufficiently covered by formal arrangements. Informal workers are everywhere – as cab drivers, domestic workers, waste pickers, vendors, cobblers, forest workers, private security guards, construction workers etc. and despite their contribution to the economy, they have been battling against their invisibility as ‘workers’ and their concerns largely remain unaddressed. Their activities are not included in the law, which means that they are operating outside the formal reach of the law; or they are not covered in practice, which means that – although they are operating within the formal reach of the law, it is neither applied nor enforced.

A fundamental legal demand across all occupational groups within the informal sector is that of obtaining recognition as workers, social protection and regulation of working conditions as afforded by labour law to other (formal) workers. Policies must also be framed to address the varied concerns of different occupational groups based on the nature and realities of their work and livelihood. For e.g., demands raised by forest, fish workers and miners have largely revolved around protecting traditional access to natural resources in a manner that ensures sustainable use,  strengthening pricing policy for craftsmen, transforming municipal laws to carve out spaces for urban vendors etc.  

Recognition as ‘worker’

The contract of employment is the primary means through which a person is recognised as an employee and is granted benefits and protection. A major hurdle in identifying many informal workers is the absence of an exclusive legal ‘employer-employee’ relationship established through an enforceable written contract. In fact, most often, employment is mediated through jobbers/contractors and is based on oral contract. 

There is a need for a broader definition of ‘worker’ to recognise those who fall outside traditional employer-employee relationship. An expanded concept would include not just those engaged in final stages of production or value addition, or those who work in what the labour law terms as ‘industry’, but also those engaged in collection of resources which constitute vital inputs for these industries (forest workers, tailors etc.)

Internationally, there exist legal provisions for informal working arrangements. Those, who do not enjoy an employee status (sub-contractors or self-employed) have been accepted as “workers” in the 1996 ILO Home Workers Convention as well as in the 2002 International Labour Conference Resolution and Conclusions on Decent Work and the Informal Economy. Policymakers need to lobby for the idea that informal workers, though outside an employment relationship based on a commercial contract, are entitled to basic rights and enjoy what the ILO calls “decent work.”

Social protection and regulation of working conditions

Of all informal workers, domes­tic workers have been most successful in getting their status as workers recognised under specific laws enacted by some states in India and securing certain welfare measures.  The enactment of the Minimum Wages Act, 1948 and the Unorganised Workers Social Security Act, 2008, has the potential to cover all ‘workers’ in­cluding the self-employed (both dependent and independent) for the purpos­es of ensuring access to basic social security. However, the policies largely remain confined to paper.

Even when informal workers are covered by labour law de jure, this alone will not ensure that their position is immediately at par with formal workers. Erratic working hours, abysmal working conditions and poorly demarcated work spaces have meant that it is not possible to apply many of the minimum standards contained in the labour laws to the majority of these workers.

There is an urgent need to bring these workers within the purview of labour law or create alternative structures for social protection and regulation of working conditions as per the standards set by labour law. A related struggle is to ensure a decent and market price for their products (craftsmen, rag-pickers etc.) i.e. setting minimum support prices for many such occupational groups.

Political representatives and civil society groups must engage in dialogue and formulate innovative strategies centring on law and policy initiatives to address the core demands of this group – recognition as workers, social protection and regulation of working conditions.

There is huge incentive for political representatives to intervene in this area. Addressing the core demands of this group will have a direct positive bearing on earnings and  poverty levels leading to economic well–being and growth.

 

Deepti Somani